To compute the break-even point in units,which of the following formulas is used?
A)FC/CM per unit
B)FC/CM ratio
C)CM/CM ratio
D)(FC+VC)/CM ratio

Question

Quizplus · Accepted Answer

Formula A is the standard formula used to calculate the break-even point in units, where FC represents fixed costs and CM per unit represents contribution margin per unit. This formula calculates the number of units that need to be sold to cover the fixed costs and reach the break-even point. The other formulas listed are not commonly used to compute the break-even point in units.

To Compute the Break-Even Point in Units,which of the Following